Does ISO14001 raise firms' awareness of environmental protection? The case of Vietnam

Environmental protection is an issue that all developing countries must cope with when inviting foreign direct investment (FDI). However, the high correlation between FDI and pollution does not necessarily indicate that foreign firms are to blame. In this study, we apply firm-level panel data from V...

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Bibliographic Details
Published in:Environment and development economics 2019-02, Vol.24 (1), p.47-66
Main Authors: Ni, Bin, Tamechika, Hanae, Otsuki, Tsunehiro, Honda, Keiichiro
Format: Article
Language:English
Subjects:
Certification
Companies
Corporate image
Cost control
Developing countries
Economic growth
Environmental management
Environmental protection
Foreign investment
Foreign subsidiaries
Grants
Host country
Hypotheses
Industrial development
Industrial pollution
ISO standards
LDCs
Literature reviews
Nitrogen dioxide
Panel data
Pollution
Pollution control
Productivity
RESEARCH ARTICLE
Social responsibility
Studies
Variables
Waste management
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Summary:Environmental protection is an issue that all developing countries must cope with when inviting foreign direct investment (FDI). However, the high correlation between FDI and pollution does not necessarily indicate that foreign firms are to blame. In this study, we apply firm-level panel data from Vietnam and unique information on waste discharge to demonstrate that foreign firms are actually more proactive in acquiring ISO14001 certification. ISO14001 is a voluntary environmental standard, the adoption of which improves a firm's performance in terms of waste control, and increases its welfare and productivity level. This study provides robust evidence that firms' efforts toward corporate social responsibility eventually benefit them as well.
ISSN:1355-770X
1469-4395
DOI:10.1017/S1355770X18000396